It's always tough to know. Since then, the Swedish company has watched its number of subscribers tick past 400 million as it expands into podcasting, live audio, and audio books. When Vogel joined Spotify in 2016, there were 1,500 employees. The mission of the MIT Sloan School of Management is to develop principled, innovative leaders who improve the world and to generate ideas that advance management practice. It is positive, though. Sometimes that is keeping the price low and grow the number of users on the platform. We're definitely the latter. And consequently, you should also take this to mean that we will be more selective with our overall spending moving forward. Thanks, operator, and welcome to Spotify's Fourth Quarter 2022 Earnings Conference Call. All right. It is opening up the platform so that creators have as much choice as possible in choosing whatever options they want to do. Grounded. They're trying to engage more with that audience, and we're obviously trying to help them monetize that audience even better. Spotify filed its IPO as a direct listing in April 2018, at which point it was cash flow positive and valued at $29.5 billion. Given many of the adjustments we made at the start of 2023, including our decision to reduce our workforce by 6%, we see our operating expenses growing slower with a material improvement in our operating loss compared with 2022. Wybierzcie dla siebie unikatowe obrczki ipoczcie jewdowolne komplety. And yes, we still believe our consolidated gross margins can reach 30% in five years. Next question from Doug Anmuth, users and subscriber growth in '23. But luckily for us, it hasn't impacted our numbers at all. Frederick Melo was once sued by a reader for $2 million but kept on writing. He Tweets with manic intensity at @FrederickMelo. Now that said, of course, we're always looking at how we can make that better. And three, do you still expect the consolidated gross margin to reach 30% within five years? This lack of consistent operating profitability is clearly testing the patience of some investors, particularly after Daniel Ek's recent guidance for 20% long-term operating margins at their 2022 investor day. We don't always talk about them, some of the things that come out 6, 9, 12 months later. Thanks, Daniel, and thanks, everyone, for joining us. Spotify (NYSE:SPOT) is the largest global audio streaming platform with 456m monthly active users (MAUs) and 195m premium subscribers. Doesnt seem very competitive compared to other big tech players. Actual results could materially differ because of factors discussed on today's call, in our letter to shareholders and in filings with the Securities and Exchange Commission. Can you help them understand why you believe in the investment to date, especially in the context of your recent management changes? How this CEO followed her curiosity to success, AI-boosted resumes increase the chance of being hired, Intel CEO on bringing chip manufacturing back to US. Gross margin of 25.3% was above guidance by 80 basis points due primarily to lower podcast content spend, along with broad-based favorability in our core music business led by strength in Marketplace. As of Q3 2022, Spotify had 4.7m podcasts on their platform, up 47% from 3.2m as of Q3 2021. But with both all the improvements we've been making in music, but also with the addition of podcasting and audio books, it is a much more resilient consumer experience. We're also forecasting EUR 3.1 billion in total revenue, a gross margin of roughly 25%, excluding severance charges and an operating loss of EUR 194 million with the latter reflecting EUR 35 million to EUR 45 million in severance charges within our operating expenses. You've seen it show up in both gross margin and on the operating expense line, and we expect to see improvements as we move into 2023. If you have an ad-blocker enabled you may be blocked from proceeding. Large increases in both research and development (R&D) and sales and marketing (S&M) costs over the past four quarters. Users can either pay for the streaming service and listen ad-free or choose to sign up for a free subscription and listen to ads. Hired less than a year ago, Jason Sole director of the mayors Community-First Public Safety Initiative said he was forced to resign after a series of clashes with the mayors leadership and left the position Feb. 4.Sole made $102,000. I think some of these trends are very powerful and very good, I think, for consumers with more choice and more artists making their way. We will continue to work to build the platform of the future, and that will take investment in new opportunities that we outlined like podcasts and audio books. But more importantly, for our share owners, I fully expect that they will continue to pay dividends in the months and years to come. Not the Paul Vogel you were looking for? We feel really good about some of the acquisitions we've made, obviously, at the high-level megaphone, but chartable and pod sites and our ability to improve measurement and attribution across all of advertising. While other entertainment streaming platforms like Netflix (NFLX) appear to be fast approaching peak subscriber saturation, Spotify's user growth has either remained flat or accelerated over the past few quarters. We've got another question from Rich Greenfield on podcasting. As Daniel mentioned, we are entering a new area with even more focus. Hey, everyone and happy new year and thanks for joining us. All right. Another question from Benjamin Black on pricing. Travel the world to capture moments and beautiful photos. During his presentation at the investor conference, Vogel said economic uncertainty has yet to have much of an impact on Spotify. And how has it impacted your thinking about new categories, some of those new categories you teased at the Investor Day? No recommendation or advice is being given as to whether any investment is suitable for a particular investor. However, this was 200 basis points less than forecast. And I know some investors don't believe that we're serious about it, but hopefully, my remarks today shows that we are really, really focused on driving efficiency going forward. Polityka prywatnoci zawiera pen informacj na temat przetwarzania danych przez administratora wraz z prawami przysugujcymi osobie, ktrej dane dotycz. $50 k. $61.5 k. $73 k. $50,119. We had a plan and a focus at the beginning of the year to really invest, particularly in some of our newer markets to grow there and make sure that we have the foothold that we wanted to have. Kolekcja Symbols toukon wstron pierwotnej symboliki ijej znaczenia dla czowieka. Mokave totake rcznie robiona biuteria lubna iZarczynowa. Do you expect any change to that conversion or to churn given the large MAU cohorts over the past couple of years? All right. Okay. Can you help quantify the annual savings from the headcount reduction you announced last week? So, it's definitely something that we're doing, and we're looking at it as a balanced portfolio approach where in some markets, we're selectively increasing prices because we're in a more mature place. Well, we've been making many investments. So, net, net, I think we went from being almost nowhere four years ago to now being the leader in many markets around the world in this space. The number of artists that are mattering for users are increasing materially. I/we have a beneficial long position in the shares of SPOT either through stock ownership, options, or other derivatives. And in light of our recent news on cost and staff reductions, I'm sure some of you are wondering if we believe that, that investment was a mistake. And then we're going to holistically now look at the business rather than looking at things bit by bit. We look at all the trends, and we try and understand how big these things could go. Noting continued growth in the smartphone market, Vogel said it was reasonable to assume that streaming will continue to grow as well. That's kind of what I can say. We've talked about podcasting that 2022 was going to be the peak year in terms of the drag that podcasting had on our gross margins. Importantly, Spotify Please disable your ad-blocker and refresh. Is this an area of focus? As the Chief Financial Officer of Spotify Technology S.A, the total compensation of Mr Vogel at Spotify Technology S.A is website and also furnished today on Form 6-K. of our investments in the platform over the past few years. And what are the reasons, if any, Spot would not take price? Moving to premium. WebIn a equity funding round in 2015, Spotify was valued at $8.5 billion. And in the meantime, please check out our webcast for the record for more details about the quarter. We'll start with opening comments from Daniel and Paul and afterwards, we'll be happy to answer your questions. I'll just once again want to reiterate my confidence in the business now as we're entering the next phase. For throughout the existence of Spotify, we have always heard of competitors, and it was always the sort of big scary wolf, whether it was Apple or Amazon in the past, et cetera. Free subscriptions populated with advertisements bring people through the door, while premium subscriptions bring in recurring revenue. They -- if Spotify does well in the market, it generally increases the revenues for the labels as well. Yes. So that's still the plan. For the story behind the numbers, we tapped the experts to join this weeks episode of Spotify: For the Record. CEO Daniel Ek and CFO Paul Vogel sat down with Dustee Jenkins, Head of Global Communications, to discuss the results and what they mean for the future of the platform. Podcast consumption hours in Q4 have nearly doubled since Q4 2019. Spotify Technology S.A. has released its financial results for the first quarter of 2023 by posting an update on its Investor website. Such R&D costs should naturally decrease once Spotify's recently launched products become more established and the heavy upfront product-related investments are complete. And so, we feel good about that and where the tech is going, and then it's really going to somewhat depend on just how the macro rolls out over time. Spotify have hired their new Chief Financial Officer, plucking from their existing team someone they trust. - Spotify CFO Paul Vogel, Q3 2022 Earnings Call. So, when you look at the core behavior, it may take longer in some developing markets than it does in mature markets, et cetera. In contrast, Spotify has been relatively disciplined at controlling general and administrative (G&A) expenses, with a QoQ decline in G&A spend as a percentage of gross profit from Q2 2022 (24%) to Q3 2022 (21%). Entering text into the input field will update the search result below. And of course, the better the engaging experience, we make the more likely they are to stay. So, it's tough to really know. And obviously, I look forward to sharing more on Stream On, sort of wink-wink around all the updates that we're planning throughout the year as well that I think will mean a lot for both music and podcasting and beyond. And even within that, we had two months that outperformed and one month that underperformed. As such, if Spotify is able to acquire customers that are valuable in the long-term (i.e., have a high customer lifetime value), it makes sense to be more aggressive with S&M investments to gain market share and strengthen their MAU lead over competitors like Apple (AAPL) and Amazon (NASDAQ:AMZN). We're not going to quantify the savings. In addition to his department directors, chosen with the help of community hiring panels, Carter has surrounded himself with a relatively young and diverse Cabinet easily the most diverse in city history. So, while reported revenue was a touch below forecast, our organic growth on a currency-neutral basis modestly outperformed due primarily to advertising. So even within Q4, it was pretty up and down. So, think about, for instance, how we're working with our label partners, think about how we're working with merchandise and other things, too. Paul Vogel is Head of Investor Relations at Spotify. We're fully aware of what's going on globally. Thanks, Paul. I would say, in general, I think we're just overall, very excited about the opportunity. Spotify announced its second-quarter There was outperformance in pretty much every region. Bulls point to Spotify's demonstrated track record of growing MAUs and premium subscribers, rave customer reviews (4.8/5 on the App Store from 23.6m reviews), excellent brand recognition, industry-leading churn rates, strong balance sheet, and a visionary CEO (Daniel Ek) who some have argued single-handedly rescued the music industry from potential extinction. While Spotify's lack of consistent operating profitability is undeniably frustrating, I am not overly concerned for the following reasons: First, Spotify is in no danger of a capital raising with consistent positive free cash flow and a fortress balance sheet consisting of 3.7b cash, cash equivalents, and short-term investments. So, could you break out -- break down which investments are falling off that will drive the positive gross margin inflection in 2023 and 2024? We think Q1 will be the low point in terms of gross margin for the year, with gross margin improving throughout 2023. So, speed will come in having more decision-making and faster decision-making. Our next question is going to come from Michael Morris on music economics. Thanks, Rich. You're seeing a lot of Polish music being very impactful as well. We had a great Q4 and ended 2022 strongly. Apply to Production Worker and more! Still early days in terms of how it's impacted at this point. Is this happening to you frequently? This concludes today's conference call. I would just add in terms of just the subs outperformance in Q4, it was pretty broad-based. spotify usa inc. All right. But our strategy is to be an open platform, and we want to enable as much as possible, and we are very partner-friendly when we're doing so. And so, it's been uncertain. Our next question is going to come from Michael Morris on advertising. Our three biggest competitors [are] Apple, Google, Amazon, Vogel said. Obviously, on the MAU side, '22 was a real outlier in terms of how much we outperformed. Dane osobowe w sklepie internetowym przetwarzane s zgodnie z polityk prywatnoci. And since we're not committed to rolling that out, I don't really have much of a sort of comment, but to say that overall, we're committed to creating the best audio experience for consumers and creators in the world. Web25 Harvey Vogel jobs available in Saint Paul, MN on Indeed.com. He spent nearly six years covering crime in the Dakota County courts before switching focus to the St. Paul mayor's office, city council, and all things neighborhood-related, from the city's churches to its parks and light rail. Ward 1 convention ends in walk-out, no endorsement after grueling 9 1/2 hours, After six decades of arts education, founder of St. Paul-based ArtStart to retire, Reporter who fled Taliban now writes for fellow refugees in St. Paul, make St. Pauls city leadership more racially and ethnically reflective, Jason Sole director of the mayors Community-First Public Safety Initiative said he was forced to resign, Why hemp farmers worry about MN legalizing cannabis, Five questions Wild must answer this offseason, Minnesota Senate passes bill to legalize recreational marijuana, For sale: A green thumb's house on Summit Avenue (with a conservatory! Next question from Rich Greenfield on audio books. He came to the Pioneer Press in 2005 and brings a testy East Coast attitude to St. Paul beat reporting. But I would just -- rather than perhaps giving any specifics here or preannounced things, I think that the most important thing I can do is kind of give a context in that there's two types of companies. Next question is going to come from Doug Anmuth on gross margin. Wed, Jul Do you believe this is happening on your platform? And as I mentioned in my opening remarks, -- some of these things we expected to take longer on seeing the benefits, but we're seeing them already in 2022, and I think that's a real positive news for the years to come. Podcasting was this business that, for 20 years, didnt change, said Vogel, a simple RSS feed. But Spotify thinks it can provide tailored recommendations just as it does with its music service to promote engagement and make podcasting an even better experience. In addition, its advertising component of the podcasting business is helping the margins grow over time.. It expects to add another 15 million monthly active users and 7 million net new paid subscribers. Well, I mean, again, we have what I think is a pretty decent music discovery already, which works pretty well. So, we're encouraged because we think fundamentally that audio books has a massive opportunity and that there are very few consumers that are currently participating in the ecosystem. Paul Vogel is the Chief Financial Officer at Spotify. I wrote this article myself, and it expresses my own opinions. What to watch: Next quarter, Spotify expects its gross profit margins to continue to improve slightly to 25.5%, which should sit well with investors. As Alex takes on responsibility as Chief Business Officer, how should we think about his priorities and leadership for content and advertising, how those might differ from Dawn's? Spotify, in a recent British regulatory filing, appointed Paul Vogel as a director, in anticipation of him replacing Barry McCarthy as the companys CFO early next year. We had strength, family plan and Duo plan. Essentially, Spotify is a lot more complex of a business than it was several years ago. We feel really good about the ad stack we're building. How are you thinking about sales and marketing spend for 2023 following the ramp in spend over the past two years? A resident of Hamline-Midway, he is married to a Frogtown woman. Let's start with Q4. Increased publishing rates and a one-off change in accruals. But as I mentioned before, we're thinking obviously how we can grow our business the best possible way. Ive got 10yrs experience. The company invests heavily in research and development to improve that playlist experience an investment it hopes will deliver advantage in a highly competitive market. So, we're focused on having the best possible platform we can have for both consumers and creators and that remains true. We've talked about the improvements in podcast gross margin as well as we expect that to get better throughout the year. I imagine in five to 10 years we will have 10,000-plus employees, he says. Analyst at a VC fund and Masters/PhD student in Clinical Psychology based out of Sydney, Australia. Okay. If you need more lookups, subscriptions start at $39 USD/month. Our user and subscriber numbers continue to climb, showing the value of our investments in the platform over the past few years. Is audio books as a category working? Year-over-year churn, though, was pretty consistent with where it was at this point last year. But things change, and the macro environment has changed significantly in the last year. Such investments have continued (or even accelerated in the case of Meta Platforms) despite substantial public pressure from investors/analysts to cut costs. However, such a slowdown in ad-supported revenue is not isolated to Spotify but is rather a function of weakening And that's going to conclude our Q&A session for today's call. Can you help us understand your thinking here? So, the answer is yes to 2022 being the peak drag from podcast. Entering text into the input field will update the search result below. It's more around increasing the speed of decision-making and increasing the focus on efficiency across the board because the next era of Spotify is one where we're adding speed plus efficiency, not just focused on speed or growth at all costs. And if you look compare to our other verticals, music and podcasting, we thought pretty much the same thing. The main drivers of gross margin compression for Spotify were: While Spotify's poor ad-supported gross margins are easily attributable to the launch of new products and being in an "investment supercycle" (note: this also occurred during 2020 and caused a temporary suppression of gross margins), it is concerning to see the medium-term plateau in Spotify's premium gross margin, which is suggestive of reduced bargaining power with suppliers (i.e., the record labels). Overall, Spotify management expect margins to improve from 2023 onwards, which provides some comfort for investors. When Netflix was growing, people used to say, Well, how big can this company be? Vogel said. - Spotify CEO Daniel Ek, Q3 2022 Earnings Call. It was up again in Q3. An interdisciplinary program that combines engineering, management, and design, leading to a masters degree in engineering and management. However, given Spotify's rapid ascent to become the global leader in audio content and Ek's high inside ownership, I'm inclined to back him to execute and reclaim Spotify from the depths of "stock market purgatory". Spotifys revenue was lighter than what analysts had expected for its second quarter earnings report. So, we had really strong Marketplace growth overall in 2022. Indeed, I see several similarities between the plight of Spotify and Meta Platforms, in that the sharp drops in share price and investor pessimism are largely self-inflicted as the founders continue to make heavy long-term investments, despite weakening macroeconomic conditions. As a result of the unpaid leave, her regular salary of $120,000 was reduced to $73,000 for 2019. And we also then announced that 2023 would be a year where you see the reversal of some of those trends. And what we've been going through has really been a multiyear approach that really culminated with what we presented to you, the community, at our Investor Day in June. And some of them, not surprisingly, haven't worked out. Spotify's Q4 guidance for MAUs and premium subscribers was strong, forecasting 479m MAUs (+5% QoQ; +18% YoY) and 202m premium subscribers (+4% QoQ; +12% YoY). And that's the plan we're tracking consistently against. I think what we said in my outset is we expect really strong growth. So, I think Q1 probably we expect more of the same. And then you can chime in because I think some added context here might be pretty good as well. Despite consistent 20%+ MAU growth and a strong market leadership position, Spotify as an investment has attracted significant scepticism from investors. 1 global streaming audio player, and that means having everything, as much as you could possibly think [of], in audio.. Paul Vogel is the Chief Financial Officer of Spotify. As CFO, he is responsible for overseeing the companys financial affairs. Spotify is the worlds most popular audio streaming subscription service with 433m users, including 188m subscribers, across 183 markets. In FX neutral terms, revenue from paid subscribers only increased 13% YoY while ad-supported revenue grew a measly 3% YoY in constant currency. 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Thank you, everyone, for joining us. One of the big things we're seeing is users are asking us, help me find more great things to go watch. So, we had kind of lowered expectations coming into Q4. And then last point I would just add is to say that structurally, as the revenue mix shifts to more and more non-music content, so both podcasting but also audiobooks, et cetera, those gross margins in those categories is going to be significantly higher than the ones we've had in the music business, too. And obviously, the big sort of counter to that would be does it mean that you can sustain yourself or is it more one-hit wonders? It was broad-based by product. Today, the book market is worth $140 billion with audiobooks just a small fraction of that, he noted. And are you seeing any conversion uplift? And the number of users on our platform that are consuming, podcast keeps growing as well. I have no business relationship with any company whose stock is mentioned in this article. We're seeing some encouraging signs. Spotifys own subscriber figures continue to climb. WebHi All, recently got an offer from Spotify for a senior program manager role based in London. While bears can criticise Spotify's lack of gross margin expansion since IPO, it is difficult to criticise their user growth or engagement, which has increased like clockwork each quarter. So pretty consistent with what we've said in the past in terms of what the impacts were in 2022 and how that will change in '23 and beyond. During this call, we'll be making certain forward-looking statements, including projections or estimates about the future performance of the company. Despite the sharp 72% drop in Spotify's share price over the past 12 months, Ek remains committed to executing against his long-term vision for Spotify, despite short-term pressure from investors/analysts. We're now in an even stronger competitive position, and I'm confident in our future prospects. So, we wanted to tackle this heads on. Vogel, a University of Pennsylvania graduate, is a Wall Street veteran who started his financial career as an We're going to continue to see Marketplace growth, which will help our music gross margin.
